276 Part II • Applying Information Technology
Discussion Questions
1.Provide evidence to support the following statement: The
growth of e-business is due to both business and technologi-
cal innovations.2.Provide an argument to either support or refute the following
statement: In B2B applications, the customer holds the great-
est power.Summary
Today we are only in the second decade of learning how to
conduct business over the Internet in general and the Web in
particular. The legal and regulatory environment of the
United States initially shaped the e-business landscape, but
the private sector was the source of technology and business
innovation. Surviving dot-com pioneers that were startups in
the mid-1990s have not only developed superior technology
capabilities but have also continued to evolve their business
models to respond to national and global competitors. At the
same time, traditional companies have invested in e-business
applications that leverage the Internet as a new channel for
communications and building existing and new relationships
with business partners and end consumers.
Although online B2B exchanges that are owned by
independent companies, or consortia, have proven to be
difficult to sustain unless both the buyer and seller markets
are fragmented, companies have invested in software for
online procurement of direct and indirect materials, with or
without the support of specialized service providers. Other
types of B2B applications that leverage a company’s
supply chain software investments are also yielding major
benefits in cost efficiencies, improved cycle time response,
and closer collaborations with selected business partners,
as well as a global reach.
Although dot-com retailers of the 1990s initially had
an advantage over traditional companies in developing
effective B2C capabilities, traditional catalog and store
retailers in many cases have gained an advantage over
competitors with only online channels. This type of multi-
channel capability, however, requires integrating systems
that support online and off-line channels. Both bricks-and-
clicks and dot-com retailers have evolved their business
models as well as their online and behind-the-scenes distri-
bution capabilities. In addition, dot-com intermediaries have
continued to emerge, and the newest success stories are
companies that have leveraged social networking platforms.
Today we have a relatively good understanding of
what makes a well-designed e-business application for
desktop and laptop users, as well as for handheld devices.
However, there is still much to be learned about competing
in a digital age in countries on continents other than North
America and Europe.Review Questions
1.Define and contrast the following pairs of terms: dot-com
and bricks-and-clicks; intranet and extranet; B2C and B2B.
2.What business capabilities are enabled by digital signatures
and XML?
3.Describe some characteristics of the U.S. regulatory
and legal environment that influenced the early growth of
e-business applications.
4.What are some of the potential benefits of B2B applications
that use the Internet?
5.Choose one of the five competitive forces in Porter’s model, and
describe a new opportunity and a new threat due to e-commerce
via the Internet for a specific industry of your choosing.
6.Why has the Internet lowered the “switching costs” for con-
sumers?
7.Describe some of the reasons that early dot-com companies
had an initial advantage over traditional companies in devel-
oping an online sales capability.
8.What is meant by the term multichannelcapability?
9.Describe some of the reasons why a company that is a
traditional catalog retailer may have an advantage over atraditional store retailer when first developing an online sales
capability.
10.What were some of the e-business innovations using Web
technologies that were introduced by Amazon.com,
Netflix.com, Dell.com, and Landsend.com?
11.Describe how eBay evolved from its original C2C business
model.
12.Why is Google today referred to as a Web portal rather than a
search engine?
13.How does a company that is a dot-com intermediary earn
revenues?
14.Why might a firm choose to use an external service provider
to host its public Web site?
15.What is one of the ways that the dot-com meltdown in the
United States during the early 2000s influenced the growth of
e-business in this country?
16.What is m-commerce and what are some of the new business
opportunities associated with it?
17.Why might a business choose to participate in a social
networking site such as Facebook?